India’s political, cultural, and historical ties to Central Asia date back to antiquity. But contemporary circumstances, namely the quest for energy and the threat of terrorism, have imparted a new urgency, adding strategic realities to historical tradition. Indeed, Foreign Minister Salman Khurshid has said that India’s energy requirements are growing at a “terrifying pace.” Consequently, India’s government recently announced that it refuses to lay down a quota for importing oil (and presumably gas) from any country, including Iran. Instead, India will buy oil (and, again, presumably gas if not other energy sources) from wherever “it gets the best deal.” In this context it is even looking at the Arctic for energy sources. Not surprisingly in this context the Caspian basin is seen as an “important source” of hydrocarbons and ONGC is buying an 8.42% share of Conoco Phillips’ holidngs in Kazakhstan. It also is buying equity (albeit modest) in Azeri fields around the Caspian.
Yet despite the urgency for India, if not Central Asia, of strengthening those ties, India is failing to keep pace with its rivals, particularly China. READ MORE